Since the idea first gained currency a few years ago, it has developed quickly. More than half the states in the U.S. have now adopted some form of trust decanting law (including Arizona, which was one of the early states but hardly the first). The state laws vary widely — from very restrictive (permitting trust decanting only in narrow circumstances) to very generous (Arizona, for instance, places very few limits on the kinds of trusts which can be decanted, and almost no limits on the kinds of changes that can be included — our entire statute is only about a dozen sentences long).

But what is “decanting,” and why is it called that? The idea evokes a fine wine metaphor: some wines improve when you simply pour them from the bottle to a carafe before serving. Wine lovers often insist that the wine “opens up” with aeration, and that the decanting gives them the chance to get a little air. There is no doubt that decanting helps reduce the sediment in the wine, if it has any (and the existence of sediment is likely an indicator that the wine was well-made and well-aged). It is not irrelevant that the new container is likely to be a beautiful crystal carafe (rather than a dusty old bottle with weathered label), which will add to the entire sensory experience.

Sometimes decanting (as applied to wine — we’re still developing the metaphor here) can be from one old bottle to another, newer bottle. The wine might then be recorked and returned to the wine cellar for additional aging. This can have the beneficial effect of allowing the sediment to be discarded, and improve the clarity and aging of the wine itself.

The metaphor actually holds up pretty well. Decanting a trust involves pouring (if you will) the trust assets from the older container (the original trust document) into a new, often more attractive, more suitable vessel (the new trust document). This can give new life to a trust of a certain age — whether it will continue for years or shortly be ready for consumption.

Why do we want to talk about decanting just now? Because I have just returned from a Chicago meeting of the Uniform Law Commission, a national group that tries to develop statutes that can be promoted in all U.S. jurisdictions. The notion is that if the law is the same — or at least similar — in all states and territories, then it will be much easier for people to figure out what works and much harder to game the legal system by constantly moving from the law of one state to the law of another.

The Uniform Law Commission committee meeting dealt with a new Uniform Trust Decanting Act, which is being prepared for adoption and distribution in the next year. A lot of progress was made — and the committee participants (formal members and a handful of observers) were dedicated, hard-working and thoughtful about the new proposed law.

A couple of things stood out (to me, anyway) about the project:

The uniform law will almost certainly divide irrevocable trusts into two categories before providing for decanting opportunities and limitations: those in which the trustee has broad discretion about distributing trust principal to the lifetime beneficiary, and those in which the trustee’s discretion is limited to a “recognizable standard” (like “for the health, education, support and maintenance of the beneficiary”).

Decanting will probably be permissible without court involvement in most cases — the trustee may simply decide that trust beneficiaries are better off with a new trust structure and make the change.

Before making some kinds of changes, though, the trustee will need to give notice to all current trust beneficiaries and those who would receive benefits upon the death of the current beneficiary (and sometimes notice will be required to more people).

The trust that comes from the decanting process will usually need to have about the same beneficial interests — if the original trust says that trust principal can be distributed to Diane but on her death everything goes to Tom and Dick, the trustee probably won’t be able to expand the list to include Harry. But if Tom is on public benefits, or is in prison, or has an expensive (and dangerous) drug habit, the trustee probably will have authority to modify the terms of the distribution to him.

Decanting is not the same thing as modifying or reforming a trust. Each has its place, and in a given case one may clearly be a better choice than the others. But one collective point about decanting, modification and reformation of trusts: today it is a lot easier than it once was to make much-needed changes to existing trusts, and this new statute will accelerate that change in Arizona and elsewhere.

Will Arizona adopt the new Uniform Trust Decanting Act once it is finalized? It’s simply too early to tell, but Arizona has been a relatively quick adopter of other uniform laws. The existing Arizona law would not need to be overwritten — or even modified — so it is likely that Arizona will at least consider the option. Meanwhile, other states with decanting statutes will face the same considerations, and those without existing decanting statutes will have an easy template for adoption.